Texas Comptroller Disaster Relief Provisions-August/September 2017

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Let Us Help
Below are some recent updates on relief benefits. If you need help or clarification on some of the issues below, please call the ABIP professional you work with or contact us at 713.954.2002. We can co-manage your hurricane relief steps.

Texas Comptroller Disaster Relief Provisions-August/September 2017
The Comptroller’s office has provided disaster relief from various state taxes and tax filings. They are listed on the Comptroller’s web site www.comptroller.texas.gov

State Tax Extensions
Businesses and individuals that were affected by Hurricane Harvey can request extensions for state tax filings by contacting the Comptroller’s office or our team can manage it for you.

Sales Tax Exemptions
A purchaser can claim exemption from sales tax on the following labor charges by giving the seller/provider an exemption certificate. The certificate must include the reason for claiming the exemption. The seller will still be required to collect sales tax if the exemption certificate is not provided.

For the following items, and as a general idea for the hurricane related expenses, make sure your provider separates the labor component of the expense incurred.

  • Nonresidential real property with a separately stated labor charge: Purchasers can claim a sales tax exemption from separately stated labor charges to repair or restore nonresidential real property damaged by the disaster. Labor to repair residential real property is not taxable.
  • Personal property: Purchasers can claim an exemption from sales tax on charges for labor to repair or restore items damaged by a declared natural disaster, including furniture and other items of tangible personal property. The exemption can also be claimed on costs to launder or dry clean damaged clothing or other items.
  • Trees: Purchasers can claim an exemption from sales tax on labor on charges for cutting down damaged branches or cutting up a damaged tree. Charges for hauling away branches, limbs or trees are taxable waste removal services. Charges for non-taxable services should be separately stated from charges for taxable services. A lump-sum charge for taxable and nontaxable services will be presumed taxable if the taxable portion is greater than 5 percent of the total bill.

Purchases With FEMA or Red Cross Debit Cards or Vouchers Are Exempt From Texas Sales And Use Tax.
Purchasers are not required to pay Texas sales and use taxes on taxable goods and services purchased with a FEMA debit card or voucher. Retailers must keep documentation that the items were purchased with a FEMA debit card or voucher for four years from the date of sale. The documentation can be either a copy of the voucher or a copy of the receipt issued to the purchaser. The receipt copy must be clearly marked “FEMA” and signed by the purchaser.

If a taxable item or service is purchased with a combination of a FEMA debit card or voucher AND cash, or a personal credit/debit card, the retailer must collect sales and use tax. The tax is based on the amount of the purchase that was paid with personal funds, but not on the amount paid with a FEMA debit card or voucher.

Motor Fuels Tax
A person who paid the tax on clear diesel fuel purchased and used in off-highway equipment for hurricane relief and recovery efforts within the counties declared disaster areas by the Governor can file a refund claim with the Comptroller’s office. The refund claim is valid for clear diesel fuel used from August 25, 2017 through September 15, 2017.

Contact Us If You Need Help
There are a number of other relief provisions that may apply to your situation. Again, please contact the ABIP professional you work with or our office at 713.954.2002 with questions or need assistance with these provisions.

Sincerely,

The Professionals at ABIP CPAs & Advisors

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